To provide an initial step toward understanding the functional relationship between the onc genes of transforming retroviruses and their cellular prototypes, structural comparisons at the nucleic acid and protein levels have been carried out. We have determined the complete nucleotide sequence of the chicken ets gene and compared it to the ets gene of E26. E26 is a genetic hybrid with sequences derived from viral structural genes and parts of essential cellular proto-onc genes. The chicken ets gene is present as a single locus with v-ets homologous sequences found in nine regions over 60 kb of genomic DNA. The major difference between v-ets and c-ets sequences is found at the 3' end, resulting in different carboxy-termini of p135 (gag-myb-ets transforming protein of E26) and the cellular proto-ets product. The cellular gene contains additional 5' sequences that can be found in chicken cDNA. The first two viral homologous regions are not found in the major ets transcript, suggesting that they are not true exons. Thus, the E26 virus demonstrates: (1) substitution of viral genes for parts of normal cellular genes; (2) truncation of the gene; and (3) acquisition of non-cellular coding proto-ets sequences. These structural differences may be responsible for the oncogenic potential of this retrovirus. We have previously determined that the mammalian homologs of v-ets consist of two distinct domains located on different chromosomes. The mammalian ets genes from man and mouse encode for identical amino acids and are over 90% conserved relative to the chicken ets gene. Ets-related genes have been isolated from Drosophila and sequence analysis indicates that the ets-2 gene of Drosophila has been highly conserved and differentially expressed during development. Because ets sequences can be found either on different chromosomes (mammals) or as contiguous sequences (chicken) , we can conclude that the v-ets contains at least two domains. As a further means to characterize the ets genes, viral ets and human ets gene regions have been expressed in bacteria.